With benefits in jeopardy, desperation grows among jobless

If gridlock continues in Washington, D.C., Thais Faustino said she will be granted a very cruel gift on Christmas morning: the end of her unemployment benefits.

Faustino, a 22-year-old Lowell resident, said she has been receiving the benefits since May 2009 when she lost her job at an e-mail marketing company in Framingham. She said the government support has helped her pay for her rent, groceries and for her 4-year-old daughter's preschool.

The Middlesex Community College student said she would be homeless without the payments she has received each week because she has failed to secure a new job.

"I am completely desperate," she said. "There are no jobs out there."

U.S. House Democrats' efforts to extend the benefits for three months for people like Faustino were dealt a blow Thursday when they could not secure a two-thirds vote on the proposal. They have pledged to seek another vote when lawmakers return after Thanksgiving.

For some people receiving the benefits, it may be too late. About 800,000 unemployed residents will lose their benefits by Nov. 30. Two million Americans will be without them at the end of December, including 52,000 people in Massachusetts, according to the National Employment Law Project.

In the second quarter of 2010, the average weekly unemployment benefit the state paid was $394.94. The state pays up to 30 weeks of benefits, but the federal government has paid out up to 99 weeks in benefits in states hardest hit by the recession.

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U.S. Rep. Niki Tsongas, D-Lowell, voted for the extension and said now is not the time to start curtailing benefits for people most in need.

"We still have too many people looking for work. There are more people searching for jobs than there are jobs," she said. "Failure to extend the benefits would cut a lifeline for hundreds of thousands of Massachusetts citizens."

But congressional Republicans want the benefits to be paid for. Some have suggested that unspent stimulus money be used to offset the $60 billion in spending to extend the long-term benefits for another year. Currently, the benefits are being paid for by emergency borrowing.

Robert Forrant, a UMass Lowell professor who studies the labor market, said not extending the benefits will hurt the broader economy, including more foreclosures.

"If they are not extended, that is that much less consumer purchasing power and less economic confidence," he said. "People who are unemployed and lose benefits will retrench further and save every penny they can save."

Last year, the expanded jobless benefits provided support for 3.3 million families across the country. More than 40 percent of the nation's unemployed have been without work for more than six months.

Chris Owens, the National Employment Law Project's executive director, worries that the failure to continue long-term benefits will put a huge burden on the retail sector of the economy during the all-important holiday season. She said she has been dismayed that Republicans have put so much emphasis on the importance to the economy of extending President George W. Bush's tax cuts, but have rejected similar arguments about unemployment payments.

"It is the single most effective government stimulus program," Owens said. "The least effective economic stimulus program is tax cuts."

Unemployment benefits have been instrumental in keeping many people in their homes, according to Brent Rourke, the coordinator of homelessness prevention programs at Community Teamwork Inc., a Greater Lowell nonprofit.

"Without that income, there are going to be a lot of people getting evicted because they can't pay their rent," Rourke said. "It will impact the poorest of the poor and working-class folks who have always been self-sufficient until now."

The Bush tax cuts could be another issue that does not get resolved because of congressional gridlock. Democrats want to extend the tax cuts for families making less than $250,000, but Republicans want all of the lower tax rates extended.

Tsongas said she does not want to extend the tax rates for the richest 2 percent of Americans because it will add $700 billion to the deficit.

"I can't believe the tax cuts for 98 percent of Americans would be held hostage to Republican desire to keep them for the top 2 percent," she said.

For Faustino, the Lowell mother, the time for political bickering is over. She said she hopes the benefits are extended as soon as possible.

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